Student Loans, unlike grants, scholarships and work-study, are borrowed funds that must be paid back, with interest. Loans are legal obligations, so before borrowing each year, consider the amount you will have to repay.

The William D. Ford Direct Loan program, known as Direct Loans, was authorized and created by the Higher Education Act of 1965. The program provides subsidized, unsubsidized, PLUS, GradPLUS and consolidation loans to borrowers for educational purposes. The lender for all of these loans is the U.S. Department of Education.

Students must meet the following requirements in order to receive a student loan:

Students must complete a FAFSA and all other financial aid requirements every academic year

The U.S. Department of Education does not pay interest on unsubsidized loans.

You are responsible for paying the interest that accrues on the loan from the time the loan is disbursed until it is paid in full.

You can pay the interest while you are in school or during a period of deferment or forbearance.

You may allow the interest to accrue and have the interest added to the principle amount of your loan which is known as capitalization.

Depending on your financial need, you may receive both subsidized and unsubsidized loans for the same enrollment period, but the total amount of these loans may not exceed the annual loan limit (see chart below).

Maximum Annual Loan Limits -
Subsidized and Unsubsidized

Year in College

Dependent Undergrad Student

Independent Undergrad Student

Graduate and Prof. Degree Student

Freshman
0-29 hours completed

$3,500 Subsidized $2,000 Unsubsidized*

$9,500 -
Only $3,500 of this amount may be in subsidized loans

$20,500 -
unsubsidized loans only

Sophomore
30-59 hours completed

$4,500 Subsidized $2,000 Unsubsidized*

$10,500 -
Only $4,500 of this amount may be in subsidized loans

Junior - Senior
60+ hours completed

$5,500 Subsidized $2,000 Unsubsidized*

$12,500 -
Only $5,500 of this amount may be in subsidized loans

Maximum Total Debt allowed in a lifetime

$31,000- only $23,000 of this amount may be in subsidized loans

$57,500-
Only $23,000 of this amount may be in subsidized loans

$138,500 -
The graduate debt limit includes loans received during undergraduate study.

NOTE:
The amounts shown in the chart above are the maximum amounts that you may borrow for an academic year. An academic year for financial aid awarding purposes consists of the fall, spring and consecutive summer terms; for example: Fall 2014, Spring 2015 and Summer 2015 (SSI, SSII and SSIII combined). You might receive less than the maximum if you receive other types of financial aid that is used to cover a portion of your cost of attendance. You will also be limited on the amount you can borrow if you are borrowing for a term less than an academic year, such as a Spring only loan. The amount of the loan can not exceed the student's cost of attendance.

Graduate Status
Students must have received their first baccalaureate degree and be fully admitted into a graduate program to be considered a graduate student. Students who have a baccalaureate degree and are enrolled in a teacher or other undergraduate certification program or are working towards a second baccalaureate degree are only eligible to receive undergraduate loan amounts.

Interest Rates and Fees

The interest rate for subsidized and undergraduate unsubsidized loans is 4.66%. The interest rate on unsubsidized loans for graduate students is 6.21%.

**Effective July 1, 2015, the interest rate for subsidized and undergraduate unsubsidized loans will be 4.29%.The interest rate on unsubsidized loans for graduate students will be 5.84%.

The interest rate for each loan period remains fixed for the life of the loan.

The current origination fee for subsidized and unsubsidized loans is 1.073%. The origination fee is retained by the federal government to reduce the cost of administering these low interest loans.

Disbursement of Loan Funds

Disbursements must be done in at least two installments.

No installment will be greater than half the amount of the loan.

Student loan money must first be used to pay for tuition, fees, room and board.

Federal regulations mandate that all first-time loan borrowers complete entrance counseling in order to be eligible for a Stafford loan. TAMIU requires all first-time borrowers at the University to attend an entrance counseling session in person prior to applying for a student loan.

Exit Counseling

Federal regulations mandate that all exiting students, due to graduation or withdrawal from the University, who have received any type of federal loan complete exit counseling. TAMIU requires students to attend an exit counseling session in person to fulfill the requirement. Students who do not attend will have a hold placed on all records and will not be allowed to receive their diploma or academic transcript.
Students dropping below half-time enrollment (6 hours) must attend an exit counseling session as well if they received any type of federal government loan at TAMIU.

Parents of dependent undergraduate students can apply for a Parent PLUS loan to help pay education expenses. Parents can apply by signing into the studentloans.gov website. You will need your federal atudent aid PIN. A credit check will be performed during the application process and the parent borrower must also sign a Master Promissory Note. The Parent PLUS Loan has a fixed interest rate of 7.21% and the currrent origination fee is 4.292%. You can visit the Federal Student Aid website for more information.

Gradute PLUS Loans

Graduate students enrolled in a degree-seeking program and attending school at least half-time are eligible to apply for a Graduate PLUS loan. Unlike the Direct Unsubsidized loan, Graduate PLUS loan approval is based on your credit. TAMIU highly recommends you apply for the maximum annual amount available under the Direct Loan program before applying for the Graduate PLUS Loan. The Graduate PLUS Loan has a fixed interest rate of 7.21% and the current origination fee is 4.292%. You can visit the Federal Student Aid website for more information.